Mobile propping up enterprise IT

Despite enterprise IT getting less of the VC pie, the sector continues to chug along, thanks in part to VC investments in mobile.

Despite Gartner projecting a 5.3 percent increase in IT spending in 2010 over 2009, and IT vendors reporting rosy earnings, venture capitalists have been moving away from investing as much in enterprise IT in the past several years. As The Wall Street Journal reports, IT represented 53 percent of VC deals in 2001 but it has plummeted to 33 percent in 2009.

It's not as if those VCs are holding their money. They're actively investing in health care, green tech, and other sectors...

...like mobile.

The irony with mobile is that while it's siphoning away VC dollars from IT, it may actually be fueling enterprise IT spending. Mary Meeker suggests that with the mobile Web we're entering the fifth major technology cycle, eclipsing the desktop Internet era, an era of personal computers driven by enterprise IT.

But mobile is very much a heavy hitter in enterprise IT, even if it didn't start there.

For a variety of reasons, enterprise IT is rapidly co-opting mobile. It has to: employees are demanding that IT support their device preferences.

Hence, while companies may have been relatively quick to adopt the BlackBerry ("Hey, I can keep my employees working 24/7, constantly tethered to e-mail!"), even the "toy" iPhone has won over the enterprise, and employees are already inventing arguments why the iPad should be next.

Why? It's the apps.

E-mail was the initial killer app for mobile, but we've moved well beyond that. From Foursquare to mobile search to Facebook Mobile, the enterprise is increasingly running through consumer-esque applications that connect employees to business partners, fellow employees, and vendors of essential services.

Even traditional IT increasingly will run on consumer-driven mobile technology. MeeGo, the amalgamation of Intel's Moblin and Nokia's Maemo mobile Linux initiatives, is making its way onto enterprise-friendly laptops. The same holds true for Google Android.

In other words, even as VCs shift their investments to mobile, their money is likely helping to drive enterprise IT. It's not a direct investment, to be sure, but no less effective. Enterprise IT is alive and well. It just looks more mobile now, and less tied to the desktop.

Dow Jones VentureSource
About the author

    Matt Asay is chief operating officer at Canonical, the company behind the Ubuntu Linux operating system. Prior to Canonical, Matt was general manager of the Americas division and vice president of business development at Alfresco, an open-source applications company. Matt brings a decade of in-the-trenches open-source business and legal experience to The Open Road, with an emphasis on emerging open-source business strategies and opportunities. He is a member of the CNET Blog Network and is not an employee of CNET. You can follow Matt on Twitter @mjasay.

     

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